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Spatial dispersion in cournot competition

Author

Listed:
  • José María Chamorro Rivas

    () (Departamento de Economía Aplicada, Universidad de Vigo, Campus Lagoas-Marcosende, 36200 Vigo , Spain)

Abstract

This paper considers the spatial model used by Anderson and Neven (1991) to study firms' decisions on locations without restricting the consumers' reservation price. We note that the pattern of locations varies as the reservation price for a fixed transportation rate decreases. For a high enough reservation price, we find Anderson and Neven (1991)'s result where firms group at the center of the market and serve all consumers. As the reservation price falls, firms start to move away from each other, increasing the quantities shipped to the consumers close to their locations.

Suggested Citation

  • José María Chamorro Rivas, 2000. "Spatial dispersion in cournot competition," Spanish Economic Review, Springer;Spanish Economic Association, vol. 2(2), pages 145-152.
  • Handle: RePEc:spr:specre:v:2:y:2000:i:2:p:145-152
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Ricardo Biscaia & Isabel Mota, 2013. "Models of spatial competition: A critical review," Papers in Regional Science, Wiley Blackwell, vol. 92(4), pages 851-871, November.
    2. Chen, Chin-Sheng & Lai, Fu-Chuan, 2008. "Location choice and optimal zoning under Cournot competition," Regional Science and Urban Economics, Elsevier, vol. 38(2), pages 119-126, March.
    3. repec:ebl:ecbull:v:12:y:2008:i:22:p:1-5 is not listed on IDEAS
    4. Kai Andree, 2013. "Collusion in Spatially Separated Markets with Quantity Competition," Journal of Industry, Competition and Trade, Springer, vol. 13(3), pages 309-318, September.
    5. Néstor Duch Brown, 2007. "The empirics of spatial competition: evidence from european regions," SCIENZE REGIONALI, FrancoAngeli Editore, pages 35-60.
    6. Torbenko, A., 2015. "Linear City Models: Overview and Typology," Journal of the New Economic Association, New Economic Association, vol. 25(1), pages 12-38.
    7. repec:ebl:ecbull:v:12:y:2007:i:1:p:1-7 is not listed on IDEAS
    8. Ricardo Biscaia & Paula Sarmento, 2013. "Location Decisions in a Natural Resource Model of Cournot Competition," FEP Working Papers 509, Universidade do Porto, Faculdade de Economia do Porto.
    9. Qiang Wang & Qi Chen, 2008. "Cournot competition and location choice with wage bargaining," Economics Bulletin, AccessEcon, vol. 12(22), pages 1-5.
    10. repec:rfe:zbefri:v:35:y:2017:i:1:p:151-171 is not listed on IDEAS

    More about this item

    Keywords

    Price discrimination; cournot competition; spatial dispersion; duopoly; subgame perfect equilibrium;

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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